STOCKS TELEGRAPH

Tag: electronics

  • Texas Instruments Inc. (TXN) Stock Exhibits Minor Volatility Ahead of Lukewarm Profit Forecast

    Texas Instruments Inc. (TXN) stock prices were up 3.45% as of the market close on July 22nd, 2021, bringing the price per share up to USD$194.24 at the end of the trading day. Subsequent premarket fluctuations saw the stock fall by 4.86%, bringing it down to USD$184.80.

    Soft Financial Expectations

    Despite the company’s revenue forecast for the current fiscal period disappointing some investors, the company is confident regarding its trajectory of success. Investors are concerned that the recent momentum seen in chip demand growth caused by the onset of the global coronavirus pandemic will be short-lived. TXN reported expecting sales ranging from USD$4.4 billion to USD$4.76 billion for the fiscal quarter ending in September of 2021, representing a profit per share ranging from USD$1.87 to USD$2.13 a share.

    Changing Marketspace

    In line with the success seen by the chipmaking sector, TXN has reported several consecutive quarters of double-digit percentage revenue growth, largely driven by increases in demand for a range of devices that use the company’s tiny electronic components. The extent of the growth seen by the sector has raised concerns that at least some of the movement is a result of panic buying from customers concerned about future shortages, that may not actually occur. Such stockpiling behavior has historically been associated with crashes.

    Lower Inventory Levels

    The company’s management reported in-house inventory having fallen to 111 days for the quarter, down from the average of 130 to 190 days it has typically maintained. The length of time between the placement of an order and the delivery to customers referred to as the lead time, has been increasing for an increasing range of TXN’s offerings.

    About TXN

    TXN, which is based out of Dallas, has an extensive catalogue of products in the tens of thousands and a massive customer base of more than 100,000. The company manufactures an array of products ranging from phones to military hardware and addresses a substantial chunk of the electronics market, facilitated by its extensive reach as the largest manufacturer of analog and embedded processing chips. The industrial machinery sector is particularly significant supplied by the company’s offerings.

    Future Outlook for TXN

    Despite the company not being able to maintain its recent trajectory of success, TXN is poised to capitalize on strategic opportunities to ensure an organic acceleration of its growth. The company is keen to adapt to the evolving chip market, with its decisions being founded in evidence-based foresight. Investors are hopeful that the company will be able to usher in significant and sustained increases in shareholders.

  • NVIDIA Corp. (NVDA) Stock Plummets Following Implementation of Stock Split

    NVIDIA Corp. (NVDA) Stock Plummets Following Implementation of Stock Split

    NVIDIA Corp. (NVDA) stock prices were up 3.41% as of the market close on July 19th, 2021, bringing the price per share up to USD$751.19 at the end of the trading day. Subsequent premarket fluctuations have seen the stock plummet by 74.79%, bringing it down to USD$189.40.

    NVDA Stock Split

    The company’s stock has been climbing steadily and substantially for quite some time now, coming in at more than USD$800 per share as of the end of June 2021. May 2021 saw NVDA announce a stock split that would see each share of common stock being divided into 4 whole shares of common stock. As of the market opening on July 20th, 2021, NVDA shares will trade on a split-adjusted basis. Accordingly, the price of each share will be reduced drastically, which is to be expected given the influx of a number of shares outstanding.

    Effect of Stock Split

    While stock splits obviously affect the price of each share, they do not have a tangible effect on the actual value of the company or the value of its shares. With changes being limited to the number of shares and according to the price of each, fundamentals remain unchanged, as does the long-term outlook of the company. Following the four to one stock split, shareholders of record will find themselves to own four times as many shares as before the split, with the actual value of their investment staying the same.

    Healthy Financials

    The company’s revenue report for the first quarter of 2021 reported USD$5.66 billion, a massive 84% year-over-year increase from the numbers reported in the prior-year quarter. This was largely motivated by a doubling of the company’s gaming revenue, which was up to USD$2.76 billion, as well as a 79% year-over-year improvement in data center revenue.  Earnings per share were also up, by 106% over the course of the year to hit USD$3.66.

    Investor Accessibility

    The resulting reduction in price per share following a stock split has the potential to positively impact longer-term gains because of the increased accessibility. This effect, however, is mitigated partially by the introduction of partial shares, which allow investors to buy fractions of shares. This offers investors the accessibility that is not time-bound as opposed to investors having to wait and time their investments around the implementation of stock splits.

    Future Outlook for NVDA

    Armed with its sustained trajectory of success over the past few quarters, NVDA is poised to capitalize on its momentum as it allocates resources to maintain its steam. Investors are hopeful that management will be able to turn the stock split around to usher in additional growth from the added exposure and accessibility.

  • SMART Global Holdings, Inc. (SGH) Stock Trend Lower Despite Continuing to Surpass Earnings Estimates

    SMART Global Holdings, Inc. (SGH) Stock Trend Lower Despite Continuing to Surpass Earnings Estimates

    SMART Global Holdings, Inc. (SGH) stock prices were down by 4.84% as of the market closing on July 8th, 2021, bringing the price per share down to USD$53.31. After hours trading saw the stock dip by 4.80%, bringing it down to USD$50.75.

    Public Offering of Shares

    July 8th, 2021 saw the company announce the launch of an underwritten public offering, wherein 3 million of its ordinary shares will be sold by certain selling shareholders in association with Silver Lake. The company itself is not offering any of its shares up for sale and, therefore, will be collecting proceeds generated from the sale of shares by the selling shareholders.

    GAAP Income

    The third quarter of fiscal 2021 saw SGH report USD$437.7 million in GAAP net sales, up 56% from the same time period of the previous year. The quarter saw the company report a GAAP net loss of USD$7.2 million, representing a net loss of USD$0.30 per diluted share. This is compared to the USD$0.8 million GAAP net income reported for the third quarter of fiscal 2020, representing a GAAP net income of USD$0.03 per diluted share.

    Year-over-year Growth

    Non-GAAP net income for the quarter came in at USD$35.5 million, a significant 107.6% increase from the prior year quarter. This representing a non-GAAP net income of USD$1.39 per diluted share, which exhibited a 98.6% year-over-year increase. Adjusted EBITDA was up 102.3% from Q3 of fiscal 2020, reporting in at USD$51.4 million for the third quarter of fiscal 2021.

    Expansion of Product Portfolio

    The company announced the launch of its newest additions to its product portfolio on June 15th 2021, showcasing the T5EN PCIe/NVMe M.2 2280 and U.2 flash drives. Both products are designed to be suited for applications requiring particularly durable and rugged technology, while securing memory storage to meet the rigorous demands of aerospace, defense, and industrial sectors.The company sources all of its components very selectively, testing them over the course of engineering development phases to ensure the highest standard of performance and reliability. The design process also includes higher margins for the routing of signal, thicker PCBs, as well as more durable housing for the devices.

    Future Outlook for SGH

    Armed with the continued proliferation of its newest technology in the burgeoning global market, SGH is poised to continue its trajectory of success. Current and potential investors are hopeful that management will continue to leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.

  • Newegg Commerce, Inc. (NEGG) Stock Prices Skyrocket Following Announcement of BTO Service

    Newegg Commerce, Inc. (NEGG) Stock Prices Skyrocket Following Announcement of BTO Service

    Newegg Commerce, Inc. (NEGG) stock prices were up a monumental 109.19% shortly after market trading commenced on July 7th, 2021, bringing the price per share up to USD$56.90 early on in the trading day.

    BTO Offering

    July 7th, 2021 saw the company announce the offering of a service to facilitate professional PC assembly for customers who use the Newegg PC Builder tool to design their own computers. The company’s build-to-order offering makes use of the company’s ENIAC in-house computer assembly service to construct and deliver fully assembled computers. NEGG sets itself apart from other competitors in the BTO offering space by providing the service significantly faster.

    Competitive Edge

    Having a varied inventory in the millions, the company can source virtually any build with the use of its existing inventory within their network, with the delivery of completed PCs available to customers anywhere in the U.S. With traditional BTO services offering limited component selection and a timeline that spans weeks to fulfill customer orders, NEGG has proven having a significant competitive edge.

    Services Provided

    The initial beta phase will result in the generation of critical insight that will guide the launch of the second phase of the company’s BTO service, which will come with more perks and options, such as laser engraving, to facilitate additional customization and personalization of consumers’ builds. The PC assembly line is staffed with a workforce of skilled technicians, ensuring the highest quality possible.

    PC Builder Tool

    June 20th, 2021, NEGG rolled out the Newegg PC Builder tool which is an online PC configurator that allows even uninitiated customers to design their own computers. The service was an instant hit, given the scope of customers who prefer professional assembly over doing it themselves. Given how complicated the process can be, with near-limitless configuration possibilities. With the plethora of components, brands, specs, and compatibility issues, the right configuration that meets customers’ needs while staying within budget can be a daunting task. Especially in light of the Covid-19 pandemic, customers have been opting more and more to have their devices built remotely and then delivered.

    Future Outlook for NEGG

    Armed with a service that massively expands the scope of its business, NEGG is poised to capitalize on the expanded and consolidated market footprint it finds itself to now have. The company is keen to leverage the resources at its disposal to organically sustain the recent surges in equity value.